US biotech boom to create 34,000 new local jobs, $16bn economic windfall

Australia is well replaced to exploit strong demand for biotech products in the US, with 34,000 new jobs expected to be created, plus a $16bn injection into the economy by 2030.

Growing appetite from the US for biotech products is set to deliver Australia an economic windfall, with around 34,000 jobs expected to be created by 2030.

Modelling from professional services firm KPMG and the American Chamber of Commerce in Australia shows that such demand from the US could result in the creation of 34,000 highly skilled jobs and inject $US10bn ($15.73bn) into the Australian economy annually and $US11.2bn in investment.

It would be a rapid increase on the $US812m that the current local biotech industry is worth, and would coincide with total revenue from the US biotechnology sector to increase from $US491bn to $US1.25 trillion in 2030.

The A Prosperous Future: Biotech report released found Australia was well-placed to reap the benefits as a result of research and clinical trial capabilities, flexible regulation and established trade agreements in the Asia-Pacific.

KPMG NSW chairman Doug Ferguson told The Australian the expected boom in the US biotech industry is a game changer for local players such as CSL and Telix Pharmaceuticals, and would help to shape the business and economic future between Australia and the world’s largest economy.

Already close ties with the US and strengths in areas such as research is tipped to help Australia grow its biotech industry.

“Australia’s got a strong biotech industry, but by tapping into the very fast-growing US sector, our own industry will get a huge lift, and it will create a lot of onshore benefit in Australia, and it will tie us into the fastest growing market in the world for biotech,” he said.

“It’s not going to land in our lap. There’s a lot of investment and support and sponsorship through the federal government and to some extent the state government and their agencies.”

KPMG modelling predicts human health biotechnology will continue to grow over the coming years due to a global increase in the prevalence of chronic disease and cancer, with R&D in the biopharmaceutical industry also seeing an uptick.

Prime Minister Anthony Albanese and US President Joe Biden look to form closer ties as part of this week’s State Visit in Washington. Topics on the agenda include business opportunities, regional security, AUKUS and strengthening co-operation in science and technology.

Mr Ferguson said businesses and government need to work together to ensure that Australia can reap the expected benefits over the coming six years, adding that it was important for companies to have boots on the ground in the US as well.

“They need to have a presence in the US. They have to really go out and meet the companies that we have profiled and interviewed as part of this research in the United States who have told us that they’re keen to work with Australian companies,” he said.

“They know that our R&D ranks above or well above world standard, and we have a very strong pool of specialists”

KPMG NSW chairman Doug Ferguson.

To further unlock the economic opportunities in the sector and boost Australia’s global market share, the report recommends that fragmented and inconsistent incentives and an uncompetitive corporate tax structure be addressed.

Geopolitics through the scope of AUKUS was also critical for the local businesses to understand, with how the US increasingly focusing on becoming the world leader in biotech as a matter of national security.

“It’s a major factor driving the industry sector, and it also leads to protecting intellectual property and so cybersecurity and other things are incredibly important to ensure Australian companies do take all necessary measures to protect and then work with trusted allies and partners to be able to grow and create a new business success,” Mr Ferguson said.